Indonesia to tap 60 GW Tidal Power Potential

Investment activities are abuzz as Indonesia targets 23 percent of the total energy mix to be sourced from renewables by 2025.

Tidal power is one of Indonesia’s untapped sources of renewable energy. For the first time, two companies – Arus Indonesia Raya (AIR) and OpenHydro – a unit of French state-owned naval defense company DCNS, plan to generate power from Indonesia’s vast tidal energy.

Estimates show that Indonesia – the world’s biggest archipelago – has the potential for up to 60 GW of tidal power – which translates to more than Indonesia’s total electricity capacity of just over 50 GW in 2015.

The Bali strait is chosen as the pilot tidal array for the project, where it plans to develop up to 20 2-MW turbines over the course of next three years. The power generated is expected to supply power directly to state-owned Pertamina. Each of the turbine that will sit on the seabed, is estimated to cost as much as $7 million in Europe. However, AIR plans to reduce the cost to as little as $4 million by using 70 percent local content in the turbines that will be produced in a factory (to be built in Indonesia).

DCNS website mentions that the tidal power project is expected to generate 300MW of installed capacity by 2023.

Although renewable energy has not taken off in a big way in Indonesia, there are some positive signs. Price of renewable energy has become competitive with fossils energy. According to one estimate, the cost of producing solar and onshore wind power had begun to reach a level where it was competitive with fossil fuels, below 10 cents per KWh.

Renewable energy is estimated to be more affordable on a per-kilowatt-hour basis compared to diesel that many remote islands in Indonesia currently rely on for power.

Indonesia’s coal exports to major consumers – India and China – are also expected to reduce as the two countries are also switching to renewable power. In fact Indonesia’s biggest coal miners – state-owned Bukit Asam and Adaro, are also diversifying into renewables.

More on Indonesia’s renewable power sector developments will be discussed at CMT’s Indonesia Renewable Power on 27 February- 1 March, 2017 in Jakarta.

For more information about the event, contact Ms. Grace Oh at grace@cmtsp.com.sg or call +65 6346 9147.